Commercial Metals Company (CMC)

Days of inventory on hand (DOH)

		Aug 31, 2024	Aug 31, 2023	Aug 31, 2022	Aug 31, 2021	Aug 31, 2020
Inventory turnover		7.50	7.41	6.52	6.57	8.14
DOH	days	48.65	49.23	55.95	55.59	44.85

August 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 7.50
= 48.65

The days of inventory on hand (DOH) for Commercial Metals Company have fluctuated over the past five years. In 2024, the company had an average of 48.65 days worth of inventory on hand, which is a slight decrease compared to the previous year where it was 49.23 days. This indicates that the company managed its inventory more efficiently in 2024.

Looking back further, in 2022 and 2021, the company's DOH was higher at 55.95 days and 55.59 days respectively. This suggests that the company had more inventory on hand relative to its sales during those years. However, in 2020, the DOH was lower at 44.85 days, indicating a more efficient inventory management that year.

Overall, a lower DOH indicates better inventory management as it means the company is selling its inventory faster and not tying up excess capital in unsold goods. Commercial Metals Company should continue to monitor and optimize its inventory levels to ensure efficient operations and maximize profitability.